Asian markets close lower amid IMF’s global growth forecast downgrade

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Nigeria's growth is projected to increase from 0.8 per cent in 2017 to 1.9 per cent in 2018 and 2.3 per cent in 2019 (0.4 percentage point higher than in the April 2018 WEO for 2019), buoyed by the impact of recovering oil production and prices.

When the world's two biggest economies - the U.S. and China - are "at odds", that is going to create "a situation where everyone is going to suffer", Obstfeld said.

The United States and China have slapped tit-for-tat tariffs on hundreds of billions of dollars of each other's goods over the past few months, rattling financial markets as investors worry that the escalating trade conflict could knock global trade and investment.

USA growth this year remained steady at 2.9 percent but is set to slow in 2019 as the effect of Trump's sweeping tax cuts wear off and the trade dispute with China begins to set in.

The Breton Woods institution, which said this at the Annual General Meetings of the IMF/World Bank now going in Bali, Indonesia, also revised downwards growth prospects for Nigeria in 2018 from 2.1 per cent to 1.9 per cent. "The negative revisions for emerging market and developing economies are more severe, at minus 0.2 and minus 0.4 percentage point respectively for this year and next year". But it predicts that USA growth will slow to 2.5 per cent next year as the effect of recent tax cuts wears off and as President Donald Trump's trade war with China takes a toll.

The IMF warned that the world faced a permanent hit to growth if the United States followed through on a threat to impose a 25% on all imported cars, and global tariffs hit business confidence, investment and borrowing costs.

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On the other hand, the International Monetary Fund increased growth projections for the United States from 2.2 to 2.9 per cent.

The US simultaneously threatened to add tariffs to a further $267 billion (£205 billion) of products, which saw China retaliate with 10 percent tariffs on $60 billion (£46 billion) of US imports.

The growth in Latin America and the Caribbean as a region are expected to diminish by 0.4 percent, so 2018 will only see an increase of 1.2 percent and by 2.2 in 2019. "Trade policy reflects politics, and politics remain unsettled in several countries, posing further risks", he added.

It also said interest rates would need to rise to curb inflation, but urged the Bank of England to remain "flexible" depending on what happens with Brexit.

"The fast rise in global oil prices, normalization of USA monetary policy, and tightening financial conditions for emerging markets are adding to this hard picture".

The eurozone's 2018 growth forecast was cut to 2.0 percent from 2.2 percent previously, with Germany particularly hard hit by a drop in manufacturing orders and trade volumes.

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